Bitcoin's Price is Nowhere Near Overheating Despite Surge to $123K: CryptoQuant

Bitcoin recently surged to unprecedented levels, breaking past $123,000 for the first time on July 14. The milestone follows earlier highs of $112,000 on July 9 and $118,000 on July 11, marking a series of sharp moves within days.

However, unlike previous rallies, the current surge appears to be supported by healthier market conditions. On-chain data from CryptoQuant suggests the market is not overheating – a notable contrast to past cycles where similar price spikes led to short-term corrections.

Bitcoin Positioned for Sustained Upside as Market Cools

CryptoQuant’s analysis focuses on a key metric known as the UTXO Age Bands, particularly the 1-day to 1-week range. Spikes in this range typically indicate short-term selling pressure and profit-taking behavior.

In March and December 2024, it showed strong activity, signaling overheated market conditions. In contrast, the current cycle shows smaller spikes, even as the apex coin trades at higher prices.

Notably, the reduced movement suggests that holders are less eager to sell quickly. Many now appear to be treating Bitcoin as a long-term asset rather than chasing short-term profits.

According to CryptoQuant, this shift in sentiment could support a more sustained rally through the second half of 2025. With the market showing fewer signs of fast-paced speculation, the absence of aggressive selling pressure may allow prices to climb further without immediate pullbacks.

Institutional Demand Builds Momentum

Alongside this behavior change is a noticeable rise in institutional interest. Between July 7 and 12, 29 companies added a combined 4,209 BTC to their balance sheets, with 80 treasury-related announcements logged in just five days.

Institutional demand is also surging through U.S. spot Bitcoin ETFs, which saw over $2.7 billion in inflows last week, far outpacing the number of new Bitcoins mined. Leading the charge is BlackRock’s IBIT ETF, which recently surpassed $80 billion in assets under management, achieving this milestone faster than any ETF in history.

Consequently, the combination of strong institutional inflows and subdued short-term selling could offer more price stability. With retail speculation slowing and larger players stepping in, Bitcoin’s path to higher prices may remain wide open.